Recent tariff tweaks small steps to drive ARPUs: Airtel CEO Gopal Vittal

chief executive Gopal Vittal said that the recent tariff tweak for prepaid and postpaid services is a “small step” in the direction to increase ARPUs to Rs 200 and eventually to Rs 300.

He said that ARPUs in India are extremely low and at the current level the company’s return on capital is in the low single digit.

In a bid to increase average revenue per user (ARPU), Airtel made some changes to its tariffs recently. Its minimum entry prepaid price will now start from Rs 79 vs Rs 49 earlier. On postpaid, it is moving all corporate entry plans to 299 from 199 while providing extra value.

“This is a small step in that direction, even as it plays to our strategy of focusing on quality customers,” Vittal said during Q1 FY22 earnings call. “ARPU must rise first to Rs 200 and eventually to Rs 300.”

Airtel deployed its sub-Ghz network on a pan India basis, which was the reason for the elevated capex in the quarter, Vittal said, adding that Airtel’s overall capex outlook for the year remains unchanged from what we discussed last quarter.

Airtel is deploying new radios in seven circles where it did not have a sub-Ghz layer. In 4 other circles, it has upgraded software to provide 4G services on the sub-Ghz layer.

“The introduction of the sub-Ghz layer will give us dramatically enhanced coverage of an additional 90 million people thereby driving greater competitiveness in our mobile segment,” he added.

During the quarter, Airtel also deployed the additional mid band spectrum in the 1800/2100 and 2300 bands to enhance capacity and improve customer experience.

See also  Government asks CERC to relieve power plants delayed due to force majeure from transmission levy

The Sunil Mittal-led telco recently launched Airtel Black, the single bill service for mobile, DTH and broadband.

“…we have seen strong traction on Airtel Black and are already close to reaching the 700K mark in terms of Homes. Remember each of these homes gives an additional Average Revenue per Account of Rs 650,” Vittal said.

“The exciting thing for us is that close to 30 million of the 50 million high value homes are already on our network either with a Postpaid, DTH or Broadband. So, this opportunity is ours to tap into,” he added.



Please enter your comment!
Please enter your name here